Market Outlook :
This month has been marked by volatility, influenced by both weak global and domestic signals. While the stock market has experienced a significant uptrend, these corrections provide attractive entry opportunities for newcomers. From a technical standpoint, Nifty surged by 964 points, reaching a new peak of 20,222 after starting at 19,258, but has since cooled off. Such fluctuations are common when the index reaches new highs, with existing investors booking profits, creating opportunities for new investors. The long-term trend remains positive, and the current dip appears to be an intermediate correction, likely finding support around the 19,500 and 19,200 levels, while 20,222 will continue to act as strong resistance ahead.
In the case of Bank Nifty, it`s important to monitor two support levels: 44,200 and 43,000, signifying trendline support. These levels should provide a safety net during the correction, while 45,200 & 46000 levels will pose a formidable resistance ahead.
Investors are likely to continue favoring sectors such as Technology, Banking, Energy, Chemicals, Cement and Automobiles during market corrections, as these sectors appear promising for investment. Conversely, it`s anticipated that profit-taking will occur in sectors like Real Estate, Metals, Fast-Moving Consumer Goods (FMCG), Infrastructure, and Pharmaceuticals. It`s worth noting that Small-cap and Mid-cap stocks could experience significant corrections, so it is advisable to exercise caution and consider avoiding them at this time.